KSE 100 Index jumps 5.7% on mutual fund inflows
Pakistan’s KSE 100 Index surged 5.7% week-on-week as mutual funds drove net inflows of $55.5 million, with trading activity also strengthening.
The benchmark KSE 100 Index posted a sharp weekly gain of 5.7%, supported largely by robust buying from domestic mutual funds, which recorded net inflows of $55.5 million up to Thursday’s close. The strong momentum in the equity market reflects renewed investor confidence amid stable macroeconomic indicators and active participation in government debt auctions.
Trading volumes surged significantly during the week, with average daily activity rising to 790 million shares, up 30% from the previous week. In terms of value, turnover reached Rs44.9 billion per day, representing an 11% week-on-week increase. Analysts noted that the heightened trading activity suggested improved sentiment, particularly from institutional investors capitalizing on lower valuations and expectations of policy stability.
KSE 100 Index declined 1.17% on Weekly Basis
On the economic front, Pakistan’s current account posted a deficit of $254 million in July 2025, narrowing from a deficit of $348 million recorded in the same month a year earlier. The reduction in the external gap indicates some relief for policymakers, though challenges around import payments and export receipts persist. The trend will remain under scrutiny in the coming months as global commodity prices and remittance flows shape the country’s external position.
In the domestic debt market, the government conducted a T-bill auction during the week that attracted substantial participation worth Rs1,385 billion. Out of this, Rs492 billion was successfully raised, while yields remained largely unchanged. The auction results suggest that investors continue to view short-term government paper as a preferred low-risk option, despite rising equity market activity.
Market watchers highlight that the simultaneous strength in both the equity and debt markets underscores a cautious but improving outlook for Pakistan’s financial system. The narrowing current account deficit, alongside strong liquidity injections into equities, has boosted confidence, although the external sector remains vulnerable to global pressures.
Looking ahead, analysts believe the KSE 100 Index’s trajectory will depend on forthcoming corporate earnings announcements and monetary policy signals. Sustained foreign inflows, further fiscal reforms, and clarity on the external financing outlook will remain critical for sustaining the current upward trend.
The benchmark index closed the week significantly stronger, with traders noting that sentiment had shifted decisively in favor of equities. With mutual funds continuing to inject liquidity, the market appears well-supported in the near term, though volatility cannot be ruled out given uncertainties in global financial markets.
Pakistan’s KSE 100 Index, therefore, ends the week on a firm footing, reaffirming its role as a barometer of investor confidence in the country’s economic direction. Market participants will be closely monitoring developments in the external account and government borrowing trends as key factors shaping future performance.